4 Bull and Bear Scenarios for ETH Price in September 2024

This is contingent upon Ethereum’s ability to navigate three substantial price challenges this September,

The Dencun upgrade has introduced low-cost blobs designed to enhance Layer-2 blockchains, facilitating quicker scalability across the network, resulting in an uptick in activity within Ethereum’s decentralized smart contract ecosystem.

As a result, gas fees in ETH on Ethereum’s base layer have plummeted significantly. While this has impacted the revenues of validators, activity on low-fee L2s has flourished.

The monthly active users on Ethereum L2 doubled post Dencun’s implementation in March. Concurrently, fees for utilizing Base, Mantra, Starknet, Blast, and OP Mainnet have seen a drastic drop.

However, Ethereum has struggled this year to accurately portray its advancements and future potential amidst a broader market trend. After dropping to $2,400 this week, it found itself at February’s price levels. In contrast, Bitcoin has managed to perform slightly better this year.

So, will Ether’s price continue its erratic behavior, or does it possess leverage over competitors like BNB, Solana, XRP, Tron, and Cardano in the near to medium term?

4 Ethereum Price Advantages In 2024

Here are four factors working in Ethereum’s favor:

1. Another Wrapped Bitcoin On Ethereum

Utilize your idle BTC effectively on Ethereum.

21BTC on Ethereum offers you:
• BTC that’s native to Ethereum
• No Lock-And-Mint technology
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• Institutional-grade security
• Deep liquidity
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Here’s what you should know(/5) pic.twitter.com/CGY97mqeut

— 21.co (@21co__) September 3, 2024

21co, the company behind Bitcoin ETF issuer 21 Shares, has recently launched another Wrapped Bitcoin asset on Ethereum.

This serves as a reminder: Your Bitcoin acts as a definitive settlement within an extremely scarce currency on the most secure blockchain for Web3 —and Ethereum embodies numerous opportunities without merely surrendering it to the establishment it is looking to disrupt.

While Bitcoin is currently in a long-term holding stage due to its network effects and the growth potential of each Satoshi’s value based on its ultimately addressable global market, when demand surges, Ethereum will undoubtedly be among the favored destinations for Bitcoin holders.

With applications spanning finance, insurance, contracts, CRMs, supply chain management, gaming, and online databases, the leading smart contract platforms like Ethereum are set for significant future growth.

2. Institutional Adoption Continues

Wall Street has so far been hesitant regarding Ethereum ETFs, with outflows posing challenges for Ether’s price. Nonetheless, institutional sentiment towards this asset remains strong, second only to Bitcoin, even as corporate project managers and institutional hedge funds also explore Ethereum’s challengers such as Solana and Cardano.

However, Ethereum and the ERC20 Layer-2 protocol Polygon (MATIC) represent the majority of institutional products currently accessible on Web3. A recent social media post by Adriano Feria, a notable ETH advocate, highlighted the growth in corporate projects leveraging Ethereum.

“It’s unfortunate for the #Ethereum skeptics, but $ETH is on track for solid institutional adoption, led by major players like Coinbase, Circle, BlackRock, and more recently, Sony,” Feria stated.

Following Sony’s announcement on August 22 regarding the launch of its own Ethereum Layer-2 blockchain, Soneium, ETH could be poised for further market momentum.

3. Ethereum Price Chart Technicals

ETH has recently endured its worst month in two years, suffering a 22% decline in August. Hence, mean reversion theory suggests that its price will likely gravitate back towards its average trend over time, providing support for a potential recovery. In consumer terms, Ether was effectively on sale during August.

Some experts indicate that ETH might be undervalued according to predictions by some of the most engaged funds, publications, and banks in the Web3 sector, as noted in a recent study by CoinGecko:

What is the price forecast for Ethereum in 2024?

Our latest research indicates that leading analysts, outlets, and fund managers anticipate #Ethereum will hit an average of $6,404 by the end of 2024.

Read the full analysis: https://t.co/FzuIYpuE9D pic.twitter.com/Lj5TXYtqkF

— CoinGecko (@coingecko) August 16, 2024

4. Dovish Federal Reserve Policy Shift

The increase in new coins suggests a planned uptick in the money supply, though this does not always lead to inflation.

If the money supply grows at the same rate as the number of users, prices can remain stable.

— Satoshi Nakamoto Quotes (@QuotesNakamoto) July 5, 2024

The Federal Reserve chair’s announcement in August about a shift towards lower interest rates is expected to invigorate cryptocurrency markets. As the supply of dollars rises, there’s additional liquidity available to fuel financial markets, including stocks and cryptocurrencies.

Moreover, there exists an ingrained philosophy among crypto investors to hedge against dollar inflation through cryptocurrencies, particularly those with strictly controlled new supplies.

Ethereum stands out as one of these alternative sound money options. Following the Merge, which transitioned it from a mined to a staked cryptocurrency in September 2022, Ethereum implemented a burn mechanism that eliminates a fraction of Ether with every transaction.

This strategy helps control supply, enabling ETH tokens to sustain their purchasing power relative to other currencies, such as Bitcoin and the US dollar.

3 Price Challenges for Ethereum in September:

1. September Doldrums as a Challenge

Historically, September has been a sluggish month for financial markets. It is the sole calendar month that has yielded an average negative return on investment over the past 98 years. This month has usually brought volatility and decreased prices for crypto assets, marked by high seasonality.

This dynamic can create a favorable entry point for crypto investors looking to acquire assets at competitive prices. However, it typically isn’t considered prime time for selling to liquidate or to maximize margins.

2. Uncertainty Surrounding the US Election

Market participants are also anxious about the outcomes of the U.S. elections scheduled for November. A Harris victory could translate to increasing prices, elevated tax rates, and more stringent regulations.

Conversely, a Trump victory might trigger another costly trade war with a significant portion of the globe, which proved detrimental for Wall Street during previous engagements.

3. Bitcoin’s Price Influence

The value of Ethereum is tightly correlated with Bitcoin’s market price. During the four-year cycle leading up to Bitcoin’s supply halvings, there is often a minor bear market following the event, which anticipates longer periods of gains leading to new all-time highs. This trend will inevitably affect the prices of altcoins.